EUR/USD Mid-Session Technical Analysis for September 30, 2021

The Euro is trading higher against the U.S. Dollar on Thursday after hitting its lowest level since July 24, 2020 earlier in the session. The common currency is being supported by a weaker greenback that is being pressured a little bit by a rise in U.S. Weekly Jobless Claims, and as investors trimmed short positions after a steep sell-off the last few sessions.

At 14:53 GMT, the EUR/USD is trading 1.1593, down 0.0003 or -0.03%.

The single currency has been pressured all week by a spike in U.S. Treasury yields amid expectations the Federal Reserve will taper its monetary stimulus beginning in November even as global growth slows. The news made the U.S. Dollar a more attractive investment.

Thursday’s U.S. economic data, though, dented some of the dollar’s strength, triggering a short-covering rally in the EUR/USD.

U.S. Weekly Initial Jobless Claims rose for a third straight week to 362,000 for the period ending September 25, the government reported. Economists polled by Reuters had forecast 335,000 jobless applications for the latest week.

That said, another report confirmed that U.S. economic growth accelerated in the second quarter, at a 6.7% clip, thanks to pandemic relief money from the government, which boosted consumer spending.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The downtrend was reaffirmed earlier in the session when sellers took out yesterday’s low at 1.1589.

A trade through 1.1755 will change the main trend to up. This is highly unlikely, but due to the prolonged move down in terms of price and time, the EUR/USD is currently inside the window of time for a potentially bullish closing price reversal bottom.

The minor range is 1.1755 to 1.1568. Its 50% level or pivot at 1.1662 is near-term resistance.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD into the close on Thursday is likely to be determined by trader reaction to 1.1596.

Bullish Scenario

A sustained move over 1.1596 will indicate the presence of buyers. This will also put the EUR/USD in a position to form a closing price reversal bottom. If the intraday rally creates enough upside momentum, we could see a rally extend into the pivot at 1.1662.

Bearish Scenario

A sustained move under 1.1596 will signal the presence of sellers. Taking out the intraday low at 1.1568 will indicate the selling pressure is getting stronger. If this continues to generate enough downside pressure then look for the move to eventually lead to a retest of the July 16, 2020 main bottom at 1.1371.

Closing Price Reversal Bottom

A close over 1.1596 will form a closing price reversal bottom. This won’t change the trend to up, but if confirmed, it could trigger the start of a 2 to 3 day counter-trend rally.